Short‐term effects of benchmarking on the manufacturing practices and performance of SMEs

Facing increased competitive pressures due to globalisation and increased quality requirements from their customers, small and medium‐sized manufacturers must increase their productivity and their competitiveness in order to survive and prosper. One way of evaluating the attainment of this goal is to compare a firm's business practices and performance with those of a group of comparable firms, or with those of firms that are recognised for their excellence – that is, to “benchmark” the organisation. As management challenges have increased in complexity, benchmarking has become a strategic tool for organisations, both large and small, and for governments seeking to assist them. However, given a lack of empirical research, little is known as to the actual impacts of benchmarking. With this in mind, the present study sought to test a model of the relationship between benchmarking, the adoption of advanced manufacturing systems, and the performance of small to medium‐sized enterprises (SMEs). The model was tested with data from 102 Canadian manufacturing SMEs that have participated in a benchmarking exercise.